Report: Michigan Restaurant Industry Grows, Faces a Labor Shortage

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Same-store sales and hiring demand increased across Michigan restaurants in the first quarter, according to the Michigan Restaurant Association’s (MRA) first-quarter research report, which was released Monday.

The report, which tracks economic and demographic trends within the restaurant industry on a statewide basis, was conducted by Cleveland Research, an independent firm. It was distributed to the MRA’s 4,500 members.

Same-store sales increased by 1.6 percent, while hiring demand rose with 32 percent of respondents stating they expect to increase the total number of employees. That’s up from 22 percent in the fourth quarter of 2017.

About 62 percent of respondents reported that the inability to find enough employees to meet the demand for labor in restaurants was their single biggest challenge. The workforce shortage is causing labor-cost pressures to rise for restaurant operators. First-quarter labor costs exceeded those in the fourth quarter and overall.

Despite challenges, respondents anticipated a 4.5 percent sales growth and 4 percent traffic growth in 2018.

“The restaurant industry continues to be a growth engine in Michigan’s economy, but the extraordinarily tight labor market is threatening the prospects of future growth,” says Justin Winslow, president and CEO of the Michigan Restaurant Association. “We are laser-focused at the MRA on workforce development solutions for this industry.

“Whether it is educating the next generation of hospitality leaders through ProStart or strategic partnerships with state and community leaders that create second-chance opportunities for individuals, we are committed to growing a dynamic restaurant industry the does well by doing good.”

More than 400 MRA member locations and $556 million in annual revenue was represented in the survey.

The report is the only independent, statewide research report tracking the state restaurant industry.

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